2013/08/15

BBBEE
Brief Explanation

US CIVIL
ENGINEERING DEPT
August 2013

Recovery & Growth

Manufacturer of premix asphalt (tar!)

Established 1965
1986 Murray & Roberts acquired MA
ISO listed, SANAS accredited
Service road construction industry
2,6 million tonnes asphalt 2011/10
2,1 million tonnes asphalt 2010/11
1,8 million tonnes asphalt 2011/12
1,8 million tonnes asphalt 2012/13

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Not authority on BBBEE

Understand process
implications for company
what to do
how to prepare for audit
understanding scoring system
learn where to improve for future

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The Question?

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So .....
What do you think BBBEE is
or
entails?

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Legislation

Employment Equity Act

B-BBEE Act Skills Dev Act

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BBBEE

Refers to Broad Based Black

Empowerment - driven by legislation
Compliance is measured via a sector-
wide generic scorecards
forms an integral part of measuring a
companys empowerment progress

Recovery & Growth

BBBEE

Is about broad-based activities

Benefits black people
black people defined as, Black means
African Black, Coloured/Chinese or Indian
people who are South African citizens by
birth or became a South African citizen
before 27th April 1994.

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Scorecard Measurement
Measured - 100 points
Based on a company being scored on
various elements relating to the
economy
society
company initiatives e.g. CSI, training, profile

The BEE Codes of Good Practice

government document that describes how the
scorecard works

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7 Elements

1. Ownership Percentage of shares

owned by black people

2. Management and Control Directors

and top management positions held by
black people

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7 Elements

3. Employment Equity Black

employees in management positions

4. Skills Development Amount of

money spent on training black
employees

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7 Elements

5.Preferential Procurement Money spend on

black owned and/or black women owned suppliers

6.Enterprise Development Money spend on

helping black owned businesses

7.Socio-economic Development Money spend

on assisting charitable black organisations

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BEE Codes of Good Practice allow for three levels of

measurement

Exempted Micro Enterprises (EMEs)

Small start up business, few employees.

Less than R5 million is exempted
Allocated a Level 4 BEE status (100%)
irrespective of ownership profile or
Level 3 BEE status (110%) if they have
more than 50% black ownership
the required to produce a BEE Certificate

Recovery & Growth

BEE Codes of Good Practice allow for three levels of

measurement

Qualifying Small Enterprises (QSEs)

Business with turnover of more than R5 but less R35

million
QSEs tend to be family run businesses,
employ and train black staff
buy from BEE Certified Suppliers
support black businesses
Can choose to be scored against any 4 of the 7
sections of the Scorecard

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BEE Codes of Good Practice allow for three levels of

measurement

Generic Enterprises

turnover of more than R35 million

Measured against all 7 sections of the

BEE Scorecard.

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Scorecard levels

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Employment equity remains an industry

challenge

The 2012 Construction Sector Report published by Engineering News highlights the employment
equity challenges faced in our industry:

WBHO has noted that demand for historically disadvantaged engineering graduates is high,
making it difficult to attract and retain such individuals.

Aveng has reported that employment equity remains the biggest industry-wide transformation
challenge in the construction sector. The company has identified seven categories of key skills
where employment equity initiatives need to be concentrated engineering, project management,
artisan skils, finance, quantity surveying, business development and general management.

Basil Read reports that it faces real challenges in its efforts to transform in terms of employment
equity and management control. It also finds skills development to be a challenging aspect of
transformation.

Murray & Roberts no different from above, is also investing

heavily in bursaries and training of young engineers

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Positives for Much Asphalt

1. EE Profile
- Good at most levels
- Management level increase
- Female Branch Managers
- 2 African
- 2 Indian
- 1 Coloured
- Female technical supervisors
- 2 African (Production Managers)
- 2 White
- Promotion and advancement
- Wage and Salary increases

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Positives for Much Asphalt

2. Training & Development
- Focused approach
- Matriculants
- In-service students
- Trainee Production Managers
- Fitters and Admin levels

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Positives for Much Asphalt

3. Enterprise Development
- Sub contractors, R160 million spend in
2011/12
- Owner drivers, delivery of asphalt

4. Socio economic
- CSI spend and projects
- Much Asphalt
- Murray & Roberts

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Negatives
Legislation changes

Perceptions

Our industry not yet be given credit

Fat cats who benefit

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BBBEE challenges

Not taken seriously;

Lack of
corporate leadership
accountability
ownership of process
understanding

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BBBEE Challenges

Transformation seen as a stand- alone

plan
Becoming a political agenda rather than a
commercial imperative
Record keeping
Resources available
Onerous audit processes - annually

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Conclusion

BEE is not just about chasing the score

ALL Employees need to experience BEE

BEE is about transformation/diversity all

encompassing for all

Meaningful, life changing

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Long-term strategy

Targets cannot be reached overnight

BEE compliance is a process that

even Government acknowledges will
take a good number of years

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